Ever since the new land acquisition law came into force in early 2014, land prices have been on the rise, largely due to higher expectation of farmers, say industry players.
The enhanced scope of R&R package to more projects adds to industry's woes. A key change in the Ordinance is that the higher compensation and rehabilitation and resettlement package would also apply to earlier exempted 13 legislations. These include the Land Acquisition (Mines) Act 1885, Atomic Energy Act, 1962, Railway Act 1989, National Highways Act 1956, and Metro Railways (Construction of Works) Act, 1978. As a result, the cost for building highways and metro rail network are likely to go up. "Issues pertaining to paying the higher compensation based on the formula devised in the Act remain a concern… and are likely to affect most projects going forward," says Anuj Puri, chairman and country head, JLL India. Some legal experts feel that doing away with consent clause in certain projects might open them up to legal challenges. Legal challenges could potentially arise in cases where exemption granted to specific projects are not found to be in public interest, or if the government exercises their discretion in an arbitrary manner, notes Aakanksha Joshi, Associate Partner, Economic Laws Practice. The amendments to the land acquisition law might not turn out to be a game changer, but just a "good first roll-back step," as Babel of Feedback Infra puts it.